Tuesday, September 8, 2015

In case of matters relating to
import/smuggling of 'gold', even as part of a baggage, no settlement
application can be filed in view of specific bar contained in third proviso to
section 127B(1) read with section 123.

Facts:

a)Assessee
imported approximately 6.5kg gold as part of his baggage.

b)Since assessee had not shown
same in baggage declaration, department alleged smuggling and issued a show
cause notice.

c)Assessee
approached Settlement Commission.

d)Department argued that since it
was a case of import of gold, settlement application was barred under third
proviso to section 127B(1). Third proviso to section 127B(1) reads as: “Provided
also that no application under this sub-section shall be made in relation togoods to which section 123 applies or to goods in relation to which any
offence under the Narcotic Drugs and Psychotropic Substances Act, 1985 (61 of
1985) has been committed”

1) In view of provisions relating to application for settlement,
particularly third proviso to section 127B(1), it is evident that no
application for settlement can be made if it relates to

goods to which section 123 applies and said section specifically
provides that it applies to gold.

2)Third proviso only makes a
reference to goods to which section 123 applies and not to section 123 itself.
Therefore, there is no question of examining provisions of section 123(1) as
also its applicability because that is not context of third proviso to section
127B(1).

3)Therefore, no application for
settlement can be made in relation to gold. Since this case clearly pertains to
gold, Settlement Commission did not have jurisdiction to entertain such an
application - Additional Commissioner of Customs v. Ram Niwas Verma [2015] 61
taxmann.com 2 (Delhi).